Pathway to Capital: The Role of SBA Lending in Supporting Main Street America
2025-09-16
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Source: Congress.gov
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this morning. We're sure. Congress and Finstead from the great state of Minnesota to lead us in the pledge and the prayer. Would you stand? Good morning, everyone. I now call the Committee on Small Business to order. Without objection, the Chair is authorized to declare a recess of the Committee at any time. I now recognize myself for my opening statement. Welcome to today's hearing, Pathway to Capital, the Role of SBA Lending in Supporting Main Street America. I want to thank our witness, Thomas Kimsey, the Associate Administrator of the SBA Office of Capital Access, for being here today. Thank you. I look forward to hearing your testimony and having a robust discussion regarding the resilience of the SBA's Office of Capital Access. The Office of Capital Access administers the SBA's government-backed lending programs, such as the flagship 7A program, the 504 loan program, and the microloan program. Together, these programs work to make capital available to small businesses who would otherwise be unable to access capital on reasonable terms.
As a lifelong small business owner myself, I know that access to capital is the lifeblood of success for Main Street America, and the working families' taxes, cuts, and President Trump's deregulatory efforts allow small business to grow and compete. But access to capital still remains critically important. While the SBA does not lend directly to small businesses, it incentivizes private lenders to do so through government-backed loans. Since taxpayer dollars could be on the hook to pay these guarantees, the SBA lending programs must operate with incredible care. Unfortunately, that was not the case under the prior administration. The Biden-Harris administration undermined the integrity of the SBA's lending portfolio by slashing prudent underwriting standards, repealing a 40-year-old moratorium on licensing new small business lending companies, and making excessively risky loans, among other actions. Predictably, this led to rising defaults in the 7A program and resulted in the first negative cash flow for the program in over a decade, putting taxpayers' dollars at risk. These decisions went against long-standing SBA positions that have been held across Republican and Democratic administrations and were often met with bipartisan and bicameral rebuke. The Biden-Harris administration's actions not only risked taxpayers' dollars, but they also allowed entrepreneurs to take loans they could not pay back. That is why in today's hearing, It is so important that we fully understand what the current administration is doing to clean up the SBA lending programs. I appreciate the actions that Administrator Loeffler and Associate Administrator Kimsey quickly took to reverse course. I look forward to exploring ways Congress can close loopholes to ensure that there are no future administration transforms the SBA to the detriment of the loan portfolio. I now recognize the ranking member for her opening remarks. Okay. We'll move on. Right. We'll do that. Okay. Our witness today is Mr. Tom Kimsey. Mr. Kimsey is the Associate Administrator for the Office of Capital Access in the U.S. Small Business Administration.
Mr. Kimsey previously served as President and CEO of Thomas USAF Group, where he managed a portfolio of more than $100 million in government-guaranteed loans each year. With over 30 years of experience in the SBA and USDA lending, it is widely recognized as a national expert in small business finance and has been an active leader in industry associations and policy advocacy. He holds a Bachelor of Business Administration and Accounting from Georgia State University.
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